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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Cash flows from operating activities:    
Net income $ 1,030,000 $ 419,000
Adjustments to reconcile net income to net cash provided by operating activities:    
Amortization of deferred financing costs 211,000 290,000
Depreciation and amortization 4,789,000 2,963,000
Straight-line rent and above/below market lease amortization (327,000) (253,000)
Amortization of loan premium (35,000) 0
Real estate contingent consideration 0 110,000
Gain on remeasurement of investment in unconsolidated entity 0 (1,282,000)
Equity in (income) loss from unconsolidated entities (80,000) [1],[2] 376,000 [1],[2],[3]
Bad debt expense 19,000 26,000
Deferred tax (benefit) (530,000) (191,000)
Change in operating assets and liabilities:    
Tenant and other receivables (108,000) (573,000)
Deferred costs and other assets 613,000 163,000
Restricted cash 268,000 103,000
Prepaid rent and security deposits 12,000 63,000
Accounts payable and accrued liabilities (697,000) (723,000)
Net cash provided by operating activities 5,165,000 1,491,000
Cash flows from investing activities:    
Real estate acquisitions 0 (4,850,000)
Additions to real estate (334,000) (361,000)
Purchase of an interest in an unconsolidated entity 0 (2,490,000)
Changes in restricted cash (54,000) 279,000
Acquisition deposits 0 (392,000)
Distributions from unconsolidated entities 278,000 0
Net cash used in investing activities (110,000) (7,814,000)
Cash flows from financing activities:    
Redeemed shares (904,000) (570,000)
Proceeds from notes payable 0 34,686,000
Repayments of notes payable (1,131,000) (19,936,000)
Offering costs (13,000) 0
Deferred financing costs (18,000) (974,000)
Payment of real estate contingent consideration 0 (980,000)
Distributions paid to stockholders (3,026,000) (1,615,000)
Distributions paid to noncontrolling interests (427,000) (302,000)
Prepaid preferred stock offering costs (4,004,000) 0
Net cash (used in) provided by financing activities (9,523,000) 10,309,000
Net (decrease) increase in cash and cash equivalents (4,468,000) 3,986,000
Cash and cash equivalents - beginning of period 21,507,000 27,972,000
Cash and cash equivalents - end of period 17,039,000 31,958,000
Supplemental disclosure of cash flow information:    
Cash paid for interest 3,884,000 3,170,000
Cash paid for income taxes 133,000 404,000
Supplemental disclosure of non-cash financing and investing activities:    
Distributions declared not paid 1,585,000 799,000
Accrued stock issue costs $ 70,000 $ 0
[1] Littleton Specialty Rehabilitation Facility was completed in April 2012 and the single tenant began paying rent in July 2012, in accordance with the lease. Tenant operations commenced upon licensure of the facility in July 2012. Littleton Specialty Rehabilitation Facility was accounted for under the equity method of accounting. Under the terms of the joint venture agreement, the joint venture may be obligated to monetize a portion of our partners’ interest in the appreciation of value in the joint venture property. These obligations may be exercised by our partners, at their sole discretion, up to three times between years two and four of the joint venture. The amount that would be paid upon monetization is subject to change based on a number of factors, including the value of the property, net income earned by the property and payment of preferred returns on equity. On December 17, 2012, our joint venture partner noticed the Company of their intent to exercise their promote monetization right, and the Company has elected to satisfy the monetization provision through a sale of the property. See additional detail in Footnote 13.
[2] The Physicians Centre MOB joint venture was acquired in April 2012 and has been accounted for under the equity method of accounting beginning with the second quarter of 2012.
[3] The Company acquired the controlling interest in the operations of Rome LTACH in April 2012 and as a result, Rome LTACH was consolidated in the second quarter of 2012. Accordingly, Rome LTACH was accounted for under the equity method of accounting during the three months ended March 31, 2012.